Royal UNIBREW A/S (0R6Z) has received a new Buy rating, initiated by Goldman Sachs analyst, Olivier Nicolai.
Olivier Nicolai’s rating is based on the potential for margin recovery and growth prospects for Royal UNIBREW A/S. The company has experienced margin dilution due to its expansion in Europe through acquisitions, which has impacted profitability. However, Nicolai anticipates a recovery in margins to levels seen in 2015-16 as the company enhances efficiencies and performance in its acquired entities.
Furthermore, there is an opportunity for improved profitability in the Nordic markets, particularly in Denmark and Finland. Should consumer sentiment improve, especially in Finland, which has been affected by a recession, there could be a faster growth trajectory than currently projected. This scenario could drive margins back to peak levels observed between 2018 and 2020, presenting a potential upside to the price target set by Nicolai.
According to TipRanks, Nicolai is a 3-star analyst with an average return of 3.6% and a 51.93% success rate. Nicolai covers the Consumer Defensive sector, focusing on stocks such as Nestlé SA, Diageo, and Diageo.